Key Considerations for States Seeking to Implement Public–Private Partnerships for New Highway Capacity

Abstract

Implementation of a public–private partnership (PPP) for new highway capacity by a public agency involves issues from enabling legislation through identification, evaluation, negotiation, and management of PPP projects. Public agencies will need (a) a legal framework to establish and enforce long-term PPP agreements; (b) policies, processes, and tools to guide policy decisions; (c) technical skills to identify, develop, and evaluate PPP projects and to negotiate agreements; and (d) skilled staff to manage and oversee projects over the long term. This paper explores key considerations involved in implementing a PPP project at a state department of transportation or other public agency. Public agencies seeking to facilitate the delivery and stewardship of PPP projects may consider whether to establish a PPP program or develop PPP projects on a project-by-project basis. PPP programs establish policies and processes that enable the fair and efficient evaluation, procurement, and oversight of PPP projects. Specifically, PPP programs include planning processes that facilitate the selection of appropriate projects as potential PPPs; evaluation processes that assist decision makers in structuring commercially viable PPP agreements that achieve policy goals, optimally allocate risks, and bring value to the investment; fair and competitive procurement processes that allow the public agency to select the best partner and negotiate a final agreement that is transparent and protects the public interest; and processes that help the public sector take on the new role of performance-based contract manager.

Process‐Based Identification of Critical Factors for Residual Value Risk in China′s Highway PPP Projects

“…Meanwhile, there is a failure path among improper demand forecasting, low traffic demand, less revenue generation, and concessionaire insolvency for private sector [13] because revenue risk is beyond its full control. irdly, public sector would sign unbalanced concession agreements by bearing too many risks due to lack of experience, thirst for private investment, and emphasis on short-term benefit [6,9,10,27,30]. Under strategic vision, future uncertainty from macrolevel, mesolevel, and microlevel should be stressed for project success and final performance in transportation PPP projects.…”

“…Furthermore, nonsystem risks are divided into three successive stages based on the authors' prior work [16], including preconstruction, construction, and operation. For PPP projects, the conducive regulatory frameworks and effective institutions by government can improve their capacity to select, design, deliver, and manage projects and to develop local finance facilities, which provide an environment to attract private investors and achieve best value for PPP by proper regulation [30].…”

Analysis of Private Investors Conduct Strategies by Governments Supervising Public-Private Partnership Projects in the New Media Era

“…The capacities, expertise and commitment level of governments are usually reflected in structuring and implementing process of PPP projects [36]. Thus, good governance has been perceived as an essential element for PPPs by many previous researchers [21,39,40]. The roles and involvement of the governments are greatly different depending on the legal environment of the host countries [41].…”

Factors Influencing the Private Involvement in Urban Rail Public-Private Partnership Projects in China

“…The terms and conditions of private involvement deserve scrutiny and understanding by public officials, as private partners join a PPP project for different reasons than governments such as pursuing profits Decorla-Souza et al, 2013). PPPs present problems for public sector accountability because the government remains responsible for services that it does not deliver (Shaoul, Stafford and Stapleton, 2012).…”